882.635 Neep/59: Telegram

The Chargé in Liberia (Wharton) to the Secretary of State

23. 1. On March 31 President Barclay wrote me a note enclosing copy of a confidential letter dated March 23 from the Amsterdamsche Bank to Liberian Minister at Paris and stating that he would appreciate being informed by me if bank’s statement concerning American participation is satisfactory to the United States Department of State. Bank’s letter states that in the event that arrangement is reached between the Liberian Government and Neep and supposing that for execution of such agreement a syndicate is being formed under the auspices of their bank they are certainly willing to give assurance that acting as trustees for Liberian Government: (a) bank will secure [see?] that portion of shares held by Dutch investors will not be transferred to other nationals, and (b) “opportunity shall be made for American investors to acquire a substantial portion of the shares”.

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2. I called upon the President immediately and asked for further information on status of negotiations and relation between the bank and Neep. President said that he would cable Liberian Minister at Paris for more definite commitments from bank.

3. On April 1st I received a note from the Secretary to the President asking me to call yesterday for a conference and enclosing a copy of a confidential letter dated March 18th from the bank direct to the President. This letter which the President says he received after that dated 23rd purports to give details concerning floating of company but fails to state by whom. Letter states that company is to have capital of 5,000,000 Dutch florins of which 1,500,000 will be subscribed and paid for by Neep; that the bank intends to take a rather important interest in capital, the amount has not been exactly determined as yet, but it will at any rate be of such an extent that joint participation of Neep and bank will represent at least 51% of the capital; bank willing to guarantee shares of Neep will be lodged with bank and will remain there; that by these measures it will be made plain that the majority of capital will remain continuously in Dutch hands; intend to reserve the remainder for American, Swedish and other Dutch nationals and special attention would certainly be given to the President’s desire that an important participation should be reserved for Americans; appropriate measures will be taken to guarantee that in event capital of company is increased over 5,000,000 control of majority will remain in Dutch hands. Bank further states that as long as agreement has not definitely been signed it will be impossible for Neep and the bank to approach friends in the United States, Sweden and Holland and it follows that for time being no names of proposed shareholders can be submitted; willing to remain in contact with Liberian Government to be able to take into account any wishes Government might have with respect to formation of company and to submit draft of articles of association to the Liberian Government.

4. In conference with the President yesterday he asked in the event that no satisfactory arrangement can be made with Neep is there possibility of an American company exploiting deposits along the lines of agreement of last August 23rd14 including the harbor project. He said that he asks in view of the fact that neither bank nor Neep will commit itself while latter still fails to furnish technical reports. He added that he will see Caffe in effort to obtain reports and again promised me geological report. I recalled to the President substance of your confidential telegram 7, February 19, 1 p.m. He regretted lack of reports stating that he does not want deposits to remain undeveloped if negotiations fail.